Dive Brief:
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Walmart on Wednesday announced that Chief Operating Officer Judith McKenna Feb. 1 will be promoted to president and CEO of Walmart International, the company’s second-largest operating segment.
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It's a natural appointment: McKenna’s career at Walmart began in 1996 at Asda, its U.K. operation, where she served as chief operating officer and chief financial officer, and also previously served as executive vice president of strategy and international development for Walmart International. Upon moving to the U.S. division, she served as chief development officer, and moved up to COO several months later.
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She replaces David Cheesewright, who has been in the role since 2014 and "recently shared his desire to retire from a full-time role," according to a Walmart press release. Cheesewright will remain with the company full time through March and then serve the company, on a limited basis, with specific projects for a longer period of time, the company said.
Dive Insight:
Walmart isn’t just the biggest retailer in the U.S., but also in the world, so its international chief oversees a significant (and arguably more complex) set of operations. And those operations are immense: Walmart’s International division serves more than 100 million customers every week in more than 6,200 retail units, operating abroad with 55 banners in 27 countries, according to a company press release. Third quarter net sales at Walmart International rose 4.1% to $29.5 billion, an increase of 2.5%.
The job, too, is a big one at the retailer. More than one international chief, in fact, has moved on to take the reins at the overall company, including current CEO Doug McMillon and his predecessor Mike Duke.
And no wonder: Walmart is ambitious overseas as it is here. The retail giant is moving assertively in China, partnering quite closely with e-commerce JD in grocery. In Canada last summer, the retailer launched an online marketplace to take on Amazon.
But not all is going smoothly. While the company has largely put its foreign bribery scandal behind it, for example, its U.K. grocery operations are beaten and battered in an ongoing price war with German no-frills chains Lidl and Aldi.
"There are phony price wars, and there are real price wars. This is a real price war," Fraser McKevitt, head of retail and consumer insight at market research firm Kantar Worldpanel, told the Financial Times in 2014, adding that larger grocers were losing market share "hand over fist."
Keep in mind that Walmart limped away from its German grocery effort in 2006, selling 85 stores to homegrown German retailer the Metro Group at a $1 billion loss after an eight-year struggle to establish a beachhead there, losing hundreds of millions of dollars a year in the process. Asda has faced similar challenges in the U.K. market, with sales falling for seven straight quarterly periods as of last year, as more shoppers head to Aldi and Lidl.
"[Asda] was the greatest division a few years ago," Howard Davidowitz, chairman of New York retail consulting and investment banking firm Davidowitz & Associates, told Retail Dive last year. "Then Aldi and Lidl went across England, and now Asda is doing very badly."
Some analysts have gone so far as calling on Walmart to unload its U.K. grocery effort. If they keep that up, they'll have to appeal to McKenna going forward.